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Seeking the next gen supply chain technology breakthroughs

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  • Supply Chain Innovators: FlipKart–Two Hour Home Delivery for Orders in India

    Flipkart, a competitor to Amazon in India, is looking to offer customers delivery of an order within two to three hours, ramping up the game for satisfying the 'I want it NOW' generation. According to an article in the Times of India, Flipkart, via its logistics subsidiary, ekart, is evaluating which products and cities it can start with even as it considers pricing for the service, which could be rolled out in the coming six months. 

    India's e-commerce space has grown rapidly in the last few years since Flipkart first started operations in 2007, when most deliveries took a few days. Now, the three top on-line retail firms — Amazon India, Flipkart and Snapdeal — offer same-day delivery in big cities for a fee. They deliver the next day for free in the big cities but deliveries can take longer outside these areas. 

    Faster delivery could, therefore, prove to be a game-changer in the country's fiercely competitive e-commerce space, reckon experts, and shortening the shipping time to a few hours may draw more users. This could also persuade Amazon India to bring the service to the country. Its parent ships goods, including detergents and shampoos, to consumers in Manhattan in 60 minutes for a $7.99 fee. 

    To be sure, there are more than a few wrinkles that need to be ironed out, said experts. 

    "There are two important things retailers need to get right to make this work," said Karan Girotra, professor of sustainable development at Insead. "First, they need to select a small subset of their offerings which are available with these time frames. Second, meeting this delivery promise requires organisations to build very different logistics and operational systems than those necessary for traditional delivery route-based delivery systems For instance, retailers may need to have many more warehouses in central parts of the city to make these work." 

    Flipkart, which already offers users across 10 cities same-day delivery, says it has a strong logistics and delivery team in place, with 13 warehouses and over 12,000 people helping with last-mile delivery.

    The interesting aspect of this strategy is the rapidity with which great new ideas in supply chain can quickly travel across seas and be adopted in developing nations, skipping a lot of the complex manufacturer/distributor/retailer/customer supply chains that developed nations went through over the last century. Less infrastructure, better service, and happier customers is the result.

  • Managing Start-Ups: Broken Cap Tables

    Fred Wilson posted this excellent advice about Henry Blodgett's company, eShares. It's something every founder should use to replace those excel spreadsheets…pretty please

    A “cap table” is a schedule of all the shares outstanding for a specific company. Here’s an MBA Mondays post I wrote back in 2011 on the subject of cap tables. If you want to know how much of a company you own, a cap table is the best way to figure that out.

    Cap tables are almost always prepared and kept in spreadsheets, usually excel, but also increasingly google sheets. And, it turns out, they are often wrong.

    Henry Ward is the founder and CEO of a company that is aiming to fix that called eShares. Last month USV led a Series A round in eShares and my partner John Buttrick wrote a bit about that investment today on the USV blog.

    The reason I tell you this is that yesterday Henry wrote a great post about broken cap tables that everyone in the start up world should read. Here are the four big takeaway’s from Henry’s post:

    1. Most cap tables are wrong
    2. Most investors don’t track their shares
    3. Note holders are often forgotten

    Employees suffer most…so look on this as a nice 2015 perk…

  • Managing Start-Ups: Great minds think alike…and fools seldom differ

    I was reminded of this phrase recently when I listened to the founders at one of my portfolio companies 'violently agree' (somewhat an exaggeration) on subjects during a board meeting.

    It turns out that they were basically correct, but the idea that some harmonious relationship needs to exist between founders is BS. Some of my most successful companies were grounded in constructive conflict among the founders, the Board and the employees. So much can go wrong in an early stage company that continuous agreements can run the company down the wrong path…quickly.

    I'd rather see a good and fair fight about direction and strategy within a company as opposed to 'steady as she goes'. Even if all looks well, viewing other alternatives is critical, even in established companies.

    In some of my past late-stage deals, senior executives were insulted that the Board questioned the long-term strategy. It was like calling a baby ugly. The only ugly thing was the ego of the executives who acted like the Board knew nothing and that their ideas were supreme.

    So here's a few pointers to keep the paranoia high and agreements well founded:

    1. Question ALL decisions–don't just let an erudite  presentation lull you into thinking it's the 'right answer'. Ask a lot of questions to see the depth of the analysis. Do'tn let others bully or stare you into silence.
    2. Get all people involved–often, quiet or introverted people don't express opinions, even though they disagree. Make sure that you poll the room on important issues to get all ideas on the table.
    3. Revisit key issues–Often, it's 'one and done' on many decisions, when they should be considered more often. In oe of my companies, we had to bring up a topic in three consecutive monthly meetings to get the founders and executives to pay attention.

  • Supply Chain Innovators: Shypd–revolutionary or ephemeral?

    Shyp is the easiest way to ship your stuff. A driver comes to your house or business, picks up all items, then takes them away to be professionally packed and shipped to their destination. They will connect the package to USPS, FedEx, UPS, OnTrac or other regional carriers – automatically figuring out the best carrier to use for each individual delivery. They are currently doing business in San Francisco, New York and Miami, thanks to over $12 million in venture funding in 2014.

    Intermediaries are always coming and going in the supply chain space. Remember WebVan, who eliminated going to the supermarket? A fantastic failure, but we now see a whole group of sons and daughters, like FreshDirect, which will likely succeed. 

    Are companies like Shyp part of that same dis-intermediation trend? Or are they just ephemeral players while something bigger and better comes along. Here are a few thoughts on the subject:

    1. Labor Force–all of these companies, such as Doordash, Cargofish, SpoonRocket, Washio, Ice Cream Life, Caviar, Grubhub, FoodPanda, Shutl, Zipments, Delivery.com, Instacart, Drizly, Postmates, Deliv, Uber, Daojia.com.cn, favor, parcel, Rosie, curbside, Door to Door Organics, Loup, to name but a few recent investments, require a mobile work force willing to work weird hours for low pay. We will certainly run out of unemployed English majors to fill these roles very soon. And what about the 250K shortage of over-the-road truck drivers, and other critical supply chain jobs no one wants? No delivery if no pickup…
    2. Technology–successful supply chain companies are all about scale economies, route density and asset-light operations.What if UPS or USPS offers to do the same thing as Shypd–pick up a box, pack it and ship it? Might cost a bit more, but those guys have the tech and route density to kill such start ups. Believe me, they are looking closely at these companies to see if they gain traction and then pounce–either by acquisition or competitive offering.
    3. What's next?–think one stop shopping when it comes to products flowing in and out of the home. You want reliable service, drivers who are not criminals, times matched to your needs and decent prices. Small companies simply cannot provide these services in a cost-effective manner. There will be some interesting consolidations in this industry in the next few years.

     

     

  • Managing Start-Ups: Blood, Sweat & RAMEN

    "Necessity taught me the very fine art of bootstrapping," Uber founder Travis Kalanick writes. "Blood, Sweat and RAMEN", is how he described it.

    I see lots of entrepreneurs who don't understand this mantra. They believe, apparently, in the good 'start up fairy' which comes down and helps them solve all their problems with the wave of a wand. And they think that their potential investors have the same powers–banish competitors, make customers sign up, deal with difficult employees, etc., etc. They wish…and I wish…but no go.

    In the end, it is hard work that gets it all done. Hard work that is mixed with a big dose of passion, a feeling that you can develop that world-class service (like Uber) that is going to revolutionize an industry, a spirit that cannot be dampened by short-term failures are all the characteristics I look for in an entrepreneur.

    I don't like to see the drag of a messy social life, distractions around holding another job, problems with co-founders, or the myriad of other issues that can draw energy away from the entrepreneur. Like Travis, I prefer people who I have to convince to come out of their basement apartment, joined an incubator (Thanks, Matt, of Placester, for believing me!), networked like crazy among the investor community and successfully raised millions in multiple rounds of funding–all with my encouragement and help, but not active, daily involvement. That's an entrepreneur…

    It's tough being an entrepreneur and most will fail at it. Those that stick to the program have huge rewards awaiting them–not just monetary, but the satisfaction of building something that advances society.

    So take some time to congratulate that entrepreneur in your life–a kid, friend, head of one of your portfolio companies–they deserve the love for all the blood and sweat and RAMEN (consumed).

     

  • Managing Start-Ups: Trust is the Hardest Skill for Founders to Learn

    Trust in others often goes against the basic principles of being a founder, especially a single one. You have the idea, you work hard on developing a business model, crafting a basic solution, sell a few customers on the product. And then what…you realize that you can't do it all yourself and you need to bring people on the team.

    Trusting your newly hired professionals does not come easy, and the primary urge is to nerd patrol their work, probably until they tell you to leave them alone, or quit.  Here's a few ideas on how to build trust in your team:

    • Start slowly–I've seen both extremes: founders giving new hires a complete free reign to do what they think is best and founders who want to approve going to the bathroom. Start small if you are not comfortable with delegating authority and give specific tasks/deadlines for a few moths until you are comfortable that they know what they are doing.
    • Ask; don't tell–avoid delineating tasks right away. Ask the new hire what they think they should do (after all, you hired an expert in their field, right?) and go with the flow, making small course corrections as necessary.
    • Respect disagreement–often, founders do not like their baby to be called ugly. But it may be. Take a deep breath and listen to what your employee is saying. It's probably true…

    The most successful people have learned the simple lesson of making it in business–hiring people that are smarter than you, giving them the responsibility and resources to succeed and holding them to their agreed-upon goals. 

    To finish, check out this neat video on trust by Fred Wilson and Jerry Colonna.

  • Supply Chain Innovators: Onshape Revolutionizes Product Design

    According to Fortune, Onshape, a computer-aided design (CAD) software startup from Cambridge, Massachusetts, has raised a total of $64 million in funding from New Enterprise Associates, North Bridge Venture Partners, and Commonwealth Capital. The funding values the company, which has operated stealthily for the past three years, at $295 million, including the funding. (This total funding amount includes $34 million in funding first reported by the Boston Globe in 2013.)

    On Monday, Onshape will announce the launch of its beta program, where it will disclose further details on its product as well as its unique pricing scheme and business model. The company, previously known as Belmont Technology, has been operating under non-disclosure agreement with more than 1,000 users, some of which are already paying customers.

    The company's basic premise: CAD software, which is a $8 billion to $9 billion industry, has been slow to adapt to modern methods of 3D design. Existing solutions make it difficult for workers to collaborate, as they're not cloud-based or compatible with mobile. (Some have offered such services, but none are pure-plays.) "The CAD market hasn't changed. The way people design and build products has changed," says according to co-founder founder and chairman Jon Hirschtick. "It's like the land that time forgot."

    Onshape's goal is to modernize CAD software. "The vision of the company is that everyone on the design team is able to use CAD together, on any computing device, anywhere," Hirschtick says.

    He would know what the market needs. He co-founded one of the largest CAD software companies, Solidworks. In 1997, SolidWorks sold to Dassault Systemes for $318 million, and Hirschtick stayed on board for the next 14 years in various roles. Under his leadership, SolidWorks grew to a $100 million revenue company. The next CEO, John McEleney, grew it to $400 million in revenue. McEleney plans to repeat that success at Onshape as its CEO.

    The pedigree of Onshape's executive team is the reason the startup has commanded a nine-figure valuation before even launching. In addition to Hirschtick and McEleney, Onshape's management includes Dave Corcoran, Scott Harris, Michael Lauer and Ilya Mirman, all of whom are ex-Solidworks executives. DevOps leader John Rousseau was a founding engineer at cloud software maker CloudWorks, and Dan Shore, Onshape's CFO, previously worked as Harvard University's CFO. Onshape employs a staff of 60.

    The team brings big ambitions to a potentially huge opportunity. "It's a big project," Hirschtick says. "It's not going to get knocked off by 20 different groups of two college students."

  • Managing Start-Ups: How to be the Connected Professional

    Mark Mason wrote an interesting piece recently on the disconnected professional. It was an admission that, although he dutifully collected people in his network, he realized that he was really not networking. It's worth a read and I'd like to offer a few more thoughts on why networking is important.

    Full disclosure–I am not the world's best networker. In my group, that honor belonged to Bill Copacino, a dear departed friend who never missed the chance to meaningfully connect, and not just to get something from the person. Bill was genuinely interested in people, their aspirations and their challenges. May he rest in peace…

    But I digress. Here are the few more thoughts:

    • Don't live on a one-way networking street–remember that person that always calls you but you never call him or her? You need to take the initiative and do outbound calling. Today, to start the New Year, I pinged about 10 people in my network that I have been meaning to contact…a New Years resolution.
    • Make an effort to meet important people in your industry–well, duh, of course, but do you actually do it? You will be surprised how many will be interested in speaking, especially if you have something meaningful to talk about with them. Too often, I hear people say that a person would never speak with them. Wrong…especially if you never tried..
    • Don't be a LinkedIn connections addict–I have turned down or ignored at least  2000 people wanting to connect with me on LinkedIn. Why? I don't know them and am not interested in having a big network that I cannot stay in touch with. 
    • Do post on LinkedIn–I send out three or so posts a day, with interesting articles that pertain to people in my network. Why? I enjoy reading the articles myself, so perhaps my network will as well. It's an easy way to stay in touch, people often comment, or get back to me and we have a conversation.
    • Finally, look up from that smartphone–I've attended a few industry conferences this year. Everyone walks around glued to their smartphone and not making eye contact. Look up! Perhaps you could actually meet some people who could help your company or career. 

     

  • Supply Chain Innovators: Veniam,Weft & Mesh Networks

    One of my portfolio companies, Weft, is at the leading edge of one of the next revolutions in supply chain–using real-time shipment related data to better plan and execute operations. And so is Veniam, a new portfolio company of Union Square Ventures, but with a slightly different goal–universal wifi availability for smart phones.

    What does Weft do? Through the Weft platform — which integrates with Weft sensors, with sensors from other providers, and with ERP and CRM systems — users log in to get the current status and to set alerts for out-of-bounds conditions (location, temperature, moisture, shock/vibration) and stage completion.

    What does Veniam do? They make a “stack” of wireless technology that lets moving objects (think buses, garbage trucks, cars, vans, etc) carry a wifi access point/router and mesh with each other and anyone else who wants to join the network. With enough density, buses driving around your city can provision a wireless mesh that anyone can use on their smart phone when they are out and about. It’s a big vision and will take a lot of work (and luck) to realize, but this or something like it is eventually going to work and we are going to have a better way to access the internet on our phones than we have today.

    Why are mesh networks a big deal? The current reality is, even though we know a lot about shipments and order availability, most of the data is not real time. If we were able to have more reliable data, we would be able to make better decisions, or so the theory goes.

    Or not…the true reality is the existing processes, people and technologies cannot handle real time data in many of their decision procedures. Oh sure, we can certainly use some of the information, but not really change fundamental operations…yet.

     Stay tuned…

  • Supply Chain Innovators: CommerceHub acquires Mercent

    In the world of omni-channel delivery, keeping track of inventory across multiple sources is a huge supply chain challenges for retailers. Local delivery options can be vast and making sure these guys are reliable and still in business can be a challenge for retailers. That's why CommerceHub's latest acquisition is so interesting to supply chain professionals dealing with these problems.

    E-Commerce technology company CommerceHub has announced its intention to acquire Seattle-based Mercent.  CommerceHub provides a virtual inventory platform that integrates retailers with a network of drop-ship suppliers. The Mercent acquisition promises to provide an enterprise scale platform to enable "retailers to expand their product assortment, generate greater demand and optimize customer delivery from any source of supply." CommerceHub said that it has enabled more than $8 billion in gross merchandise value in the prior 12 months.

    If anything, the last mile delivery world will become more, not less complex, over the coming decade, creating more demand for new technologies to master the process.